Shares in oil and gas explorer 88 Energy have surged after the company completed an oversubscribed $25 million capital raising to fund ongoing work at its Icewine project in Alaska.
88 Energy raised the funds through the placement of 715 million shares at 3.5 cents each to domestic and overseas investors.
The company originally set a target of up to $15 million plus $5 million in oversubscriptions, but the raising was met with further demand.
88 Energy shares were 15.4 per cent higher to 4.5 cents each at 10am.
The company’s stock has rallied in recent months, surging from a two-year plateau of about 0.8 cents a share to 7.6 cents each by mid-March.
The recent share spikes have been on the back of exploration updates at Icewine, but have not gone unnoticed by the ASX, which has handed the oil and gas explorer several price queries.
The proceeds of the raising will be used to fund the acquisition of seismic data, along with the purchase of about 70,000 hectares of land in relation to its Icewine project, and for general working capital.
“The level of support the company received from institutional and sophisticated investors in Australia and the UK is a step change to only a few short months ago, reflecting the substantial de-risking that has occurred at Icewine as a result of the recent Icewine#1 exploration well,” 88 Energy managing director David Wall said.
In particular, the work done by our joint venture partner Burgundy Xploration is to be lauded as many years of hard work begin to see fruition.
“The funds raised will bring the joint venture to the doorstep of the next transformational event for the project, that being the drilling of our second well, Icewine#2H.”
